UEFA have confirmed that Crystal Palace will be demoted from this season's Europa League to the Conference League with Nottingham Forest expected to replace them in the second-tier competition.
The governing body had been evaluating whether the FA Cup winners should be kicked out because American shareholder John Textor is the majority owner of Lyon, the French side also qualified for the Europa League.
Palace are expected to launch an appeal with the Court of Arbitration for Sport after UEFA said that its Club Financial Control Body's multi-club ownership criteria had been breached and would “reject Crystal Palace’s admission to the 2025-26 UEFA Europa League and to accept Crystal Palace’s admission to the 2025-26 UEFA Conference League.”
Lyon have taken priority because UEFA rules prioritise league finishing positions over domestic Cup wins.
Textor, who owns 43 per cent of Palace, had reiterated on Thursday that he never held direct influence over the club, insisting that he can prove he has never made “management decisions” at Selhurst Park.
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But he failed to place his stake in Palace into a blind trust by a March 1 deadline that was long before their Cup win and UEFA have decided to take exception by blocking their participation.
They will, however, be allowed to play in the Conference League with an expectation that Forest, who were qualified for that competition, will swap places.
Confirmation of that switch may not arrive until any appeals process reaches its conclusion but UEFA's rule 4.10 states: "A club that is not admitted to the competition is replaced by the next-best-placed club in the top domestic championship of the same association, provided the new club fulfils the admission criteria."

Palace's relegation had been expected since Tuesday, when Lyon succeeded in their appeal against relegation from Ligue 1 for financial reasons. To satisfy that appeal Textor has stepped aside from operational control at the club.
Had their demotion been upheld, they would have been excluded from Europe but their reinstatement has also seen their place in the Europa League secured, prompting UEFA to demote Palace instead.
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